The regulatory context and mandate

This Initiative arises directly from the Financial Conduct Authority’s Pure Protection Market Study and the FCA’s work to address weak consumer engagement with protection.

As part of their response to the Market Study, the FCA has asked the Protection Distributors Group to lead and convene key market stakeholders in developing a sustained, market-wide consumer engagement programme.

They have made clear that they do not seek a one-off awareness campaign. And the PDG believes that it cannot belong to any one trade body, sector or commercial interest: it should be an industry-owned and delivered Initiative, convened and led by PDG, arising from the FCA’s Pure Protection Market Study and supported by continuing senior FCA engagement.

The FCA expects insurers, distributors, intermediaries, trade bodies, consumer organisations and other relevant stakeholders to work constructively with PDG. It also expects the market to provide the senior engagement, expertise, resource, active participation and appropriate financial support required to turn the proposal into an effective and sustained programme.

The FCA will not design or deliver the programme on industry’s behalf. Responsibility for development and delivery will rest with industry through appropriate and balanced governance. However, the FCA has indicated that it will remain actively engaged, including through senior sponsorship and participation in the governance arrangements, providing strategic challenge and helping maintain alignment with the wider package of work arising from the Market Study.

PDG welcomes the responsibility it has been asked to take on. We also recognise that the Initiative will only succeed if the whole market has confidence in its purpose, governance, neutrality, funding model, decision-making and measures of success.

That is the basis on which we now invite the market to engage.

Why the Initiative is needed

The UK protection market already does a great deal of good. It offers valuable products, has deep technical expertise, pays many thousands of claims each year, and helps families, households and businesses through moments of serious financial shock.

But the FCA’s Pure Protection Market Study has identified weak consumer engagement with protection as a central market issue. This reflects a long-standing problem familiar to many across the market: too many people do not think about protection unless something prompts them to do so, and even then many do not understand what protection is for, what it costs, how it works or when it may be relevant to their lives.

The result is a large and persistent protection gap. Millions of people remain more financially vulnerable than they need to be, not necessarily because suitable and affordable protection products do not exist, but because the market has not yet found a way to make protection sufficiently understood, trusted, normal and easy to engage with.

This Initiative is intended to address that problem.

Its task is broader than advertising and it certainly must not promote any one insurer, distributor, intermediary, trade body, product or distribution route. The aim is to build a sustained and neutral market-wide consumer engagement programme that helps people better understand their protection needs and, where appropriate, take practical steps to reduce their financial vulnerability.

That will require credible governance, professional delivery, proper funding, accurate consumer insight, clear accountability, competition-law discipline and active participation from across the market.

It will also require trust between organisations that do not always see the market in the same way. For that reason, the Initiative must be built collaboratively from the start.

What the Initiative is intended to achieve

The purpose of the Initiative is to enable more consumers to reduce their financial vulnerability by improving their understanding of protection and making it easier for them to engage with appropriate next steps.

The Initiative should help consumers understand:

• why protection may matter to them;
• what different types of protection are designed to do;
• when protection may be relevant at different life stages;
• how affordability, underwriting and claims work from the consumer’s perspective;
• how to challenge common misconceptions about protection, including misconceptions about cost, reliability and claims;
• how protection can interact with trusts, nominated beneficiaries, wills, powers of attorney and wider financial planning;
• and where to go next to explore appropriate options, obtain guidance or advice, and take practical next steps where protection is suitable.

The Initiative should seek to engage all relevant consumer segments, while paying particular attention to groups that are currently under-engaged by existing market routes. These are likely to include renters, the self-employed, gig-economy workers, younger households, parents, carers, people with limited savings, and consumers experiencing major life changes.

Success should not be judged only by campaign reach, website visits, media coverage, stakeholder participation and consumer interactions. These may well be KPIs, however, the Initiative’s real test is whether it improves consumer understanding, increases informed consideration of protection needs, supports better consumer journeys, reaches groups the market has historically underserved, and helps more people take practical and appropriate steps to protect themselves and their families.

The first phase should therefore include work on a small number of proposed success measures. These should be clear enough to guide funding, governance, delivery and review.

Confirmed FCA expectations

The FCA has made clear that it expects the market to work together with PDG to develop a sustained programme of work rather than a one-off marketing campaign.

• It has also made clear that:
• robust governance will be essential; 
• market participants and other relevant stakeholders should engage constructively with the Initiative;
• appropriate resource, financial support and active participation will be needed;
• funding arrangements should be agreed as an early priority;
• funding should be equitable, proportionate and sufficient to support professional development, launch, governance, measurement and sustained delivery;
• relevant firms and industry bodies should participate in and work through the governance structure PDG will establish;
• and those arrangements should be agreed at pace.

The FCA has also indicated that senior FCA colleagues will participate in the governance arrangements in an appropriate capacity, including through Director-level sponsorship. That participation is intended to provide strategic challenge and help ensure alignment with the broader aims of the FCA’s protection gap remedies package, while responsibility for delivery remains with industry.

These expectations give the Initiative authority. They also create a responsibility for all of us to respond constructively, seriously and quickly.

PDG’s proposed response

PDG’s role is to provide leadership, urgency and practical direction.

But leadership does not mean ownership in isolation. The Initiative is FCA backed, and PDG convened, but it must become industry-owned.

We recognise that insurers and other potential participants will have legitimate questions before committing senior people, executive resource and, especially, funding.

Those questions include:

• What is the strategy?
• What outcomes are we trying to achieve?
• How will success be measured?
• How will decisions be made?
• How will governance be balanced?
• How will funders have appropriate influence without the Initiative being controlled by any one firm or sector?
• How will the Initiative remain neutral and competition-law safe?
• How will it avoid becoming another well-intentioned but slow-moving industry forum?
• We intend to address these questions openly and early.

PDG therefore proposes to begin with a mobilisation phase focused on governance, stakeholder engagement, funding principles, success measures, competition-law protocols and the first delivery brief.

The aim is not to present the market with a finished answer. The aim is to create a disciplined process through which the right people can develop a serious and effective answer together.

How the Initiative will be governed

Robust governance is essential. The Initiative will only succeed if it has enough legitimacy to command support across the market, enough independence to preserve trust, and enough decision-making capability to move from agreement in principle to delivery in practice.

PDG therefore intends to establish two linked bodies.

First, an executive group will be formed to develop and deliver the programme. This group will need to be small enough to act promptly, senior enough to be taken seriously, and expert enough to manage a complex market-wide programme. Its role will be delivery.

Second, an oversight board will be established to provide strategic direction, accountability and challenge. It will need a respected independent chair and selected members with the experience and authority needed to help the Initiative hold the confidence of the market.

Both groups will be selected from across the industry and wider stakeholder community. They will need to bring together people with expertise in protection, consumer engagement, distribution, governance, finance, marketing, risk, regulation, competition law and consumer outcomes.

The governance structure must be visibly balanced. It must include proper insurer input, distribution insight, consumer perspective and sufficient independence. It must also avoid becoming so large or broadly representative that it loses the ability to make decisions.

The test for appointment will not be so much as to whether every constituency has a seat, but rather whether the right people are in the right places to enable the Initiative to succeed.

We recognise that significant funders will require confidence that decisions are made properly, that money is spent against agreed objectives, and that they have an appropriate voice in the process. We also recognise that funding size cannot be allowed to convert the Initiative into a programme controlled by one or two firms.

That balance will be central to the governance design.

How we will work with the market

PDG wants to work with insurers, reinsurers, distributors, advisers, trade bodies, consumer organisations, public-interest bodies and others in a spirit of genuine collaboration.

We must not create a forum in which every issue is reopened indefinitely. We do not want a process that becomes so cautious that it loses momentum. We do not want parallel initiatives to fragment the market’s response. But nor do we want to create a plan that asks organisations to support something they have not had a fair opportunity to shape.

Our approach will therefore be based on six principles.

• Clarity
  Stakeholders should understand what the Initiative is trying to achieve, what stage the work has reached, how decisions will be made, and how they can contribute.

• Inclusion
  Relevant voices should have proper opportunities to contribute, particularly where they bring funding, consumer insight, delivery expertise, operational experience, market reach or public-interest perspective.

• Balance
  The Initiative must reflect the whole market and the consumer interest, including insurers, distributors, advisers, reinsurers, trade bodies and relevant public-interest organisations.
• Pace
  Consultation must not become a substitute for progress. The Initiative has to move at the speed required by the FCA’s Final Report timetable.
• Discipline
  Constructive challenge will be welcomed. Repetition, delay and competing agendas that weaken delivery will not.
• Consumer focus

The test of stakeholder input will be whether it helps consumers understand protection better, engage more easily and reduce financial vulnerability where protection is suitable for their needs.

What we ask of organisations now

The PDG’s mobilisation response to the FCA’s expectations arising from the Protection Products Market Study, is to ask insurers, distributors, trade bodies, consumer bodies, public-interest organisations and other relevant stakeholders to take four practical steps. Each organisation should please:

1. appoint a senior lead for its engagement with the Initiative. This should be the most senior and suitable executive reasonably available: someone with enough authority to represent the organisation’s position, commit internal resource, maintain momentum, and ensure that decisions do not become trapped in internal process.
2. provide clear contact details for that senior lead. The Initiative will need to move at pace, so we will need direct and reliable routes into each participating organisation.
3. nominate exceptional individuals who could play a role on either the executive group or the oversight board. Those nominations may come from within the organisation itself or, where appropriate, from elsewhere. Each nomination should include:

• the individual’s name and current role;
• the role for which they are being suggested;
• a short rationale for the nomination;
• the expertise, authority or perspective they would bring;
• any relevant conflicts or independence considerations;
• and, where appropriate, a brief CV or career summary.

4. Organisations should please provide an initial written response to this proposal, setting out:

• whether they support the purpose and proposed direction of the Initiative;
• what headline issues not covered here they believe must be addressed during mobilisation;
• what expertise, evidence or resources they may be able to contribute;
• what governance, funding, competition-law or neutrality concerns they would like considered early;
• and any suggested additions to the first phase of work.

The executive group will need people to cover all normal exco functions with practical delivery capability, energy, judgement and relevant expertise. It will be responsible for developing and delivering the programme. We envisage a team of 9.

The oversight board will need people with authority, judgement, and independent mind, pan-market credibility and the ability to provide strategic direction, accountability and challenge. We envisage a team of 11 to include the CEO and one more of the executive group

Both groups must be selected carefully. They cannot be representative committees in which every interested party has a seat. We will need the right blend of seniority, expertise, consumer focus, market reach, diversity, independence and ability to get things done.

We therefore ask market participants to approach nominations in that spirit. Your test should not be who needs to be represented, but who can best help the Initiative succeed.

Funding principles

Funding arrangements will need to be agreed as an early priority.

The Initiative cannot be built on goodwill alone. It will require professional marketing, consumer insight, behavioural research, digital infrastructure, finance, legal and governance support, measurement, reporting and ongoing optimisation.

The FCA has made clear that funding should be equitable, proportionate and sufficient to support the professional development, launch, governance, measurement and sustained delivery of an effective engagement programme.

We also recognise that organisations, particularly insurers and other likely funders, will want a clear strategy, business case, governance model, decision-making process and set of success measures before committing significant funding.

The funding discussion should therefore begin early, but it should not be divorced from strategy. The first phase must connect funding to purpose, outcomes, governance and delivery.

PDG believes the funding discussion should be grounded in the following principles. Funding must be.

• Sufficient.
  A small administrative budget may help at the outset, but a successful national consumer engagement programme will require materially greater support.

• Proportionate.
  Contributions should reflect the scale of relevant market participation and expected benefit. Possible approaches may include reference to market share, gross written premium, protection sales volume, lives covered or other relevant measures.

• Equitable.
  The structure should avoid unfairness between firms and sectors and deter free-riding.

• Transparent.
  Participants should understand how funding is calculated, approved, spent and reviewed.

• Sustained.
  The Initiative is intended to be a programme of work, not a short campaign. Funding should therefore allow proper testing, learning, improvement and continuity
• Subject to balanced governance.
  Significant funders should have appropriate confidence and influence. But funding size cannot be allowed to convert the Initiative into a programme controlled by a few firms. The consumer interest must remain central.

PDG sees this as the hardest issue on which to gain market wide agreement, and therefore one to be addressed early, and agreed collegiately and professionally. It must not become an open-ended debate that delays unduly the work the FCA requires of us all.

Competition law and neutrality

The Initiative will necessarily involve competitors working together. We will therefore need clear rules of engagement, proper governance, appropriate legal support and disciplined conduct from the outset.

We cannot discuss or coordinate commercial pricing, product terms, underwriting approaches, distribution strategy, individual firm conduct, commercial negotiations or any other matter that would be inappropriate for competitors to discuss collectively.

The Initiative must also preserve neutrality. It should not promote individual firms, products, brands or distribution routes. It should help consumers understand protection and find appropriate next steps, without becoming a disguised commercial lead-generation vehicle for any one part of the market.

As the Initiative develops onward consumer pathways, those pathways will need to be transparent, fair, non-discriminatory and consistent with the Initiative’s consumer purpose. They will need to preserve trust and avoid any perception that consumer education is being used to directly favour commercial participants or undermine consumer confidence in any one part of the market.

PDG will therefore seek early advice on the competition-law and neutrality framework within which the Initiative should operate. We expect this to include:

• meeting protocols;
• information-sharing rules;
• governance terms;
• conflict-management procedures;
• rules for consumer-facing neutrality;
• and appropriate oversight of any future consumer pathway design.

The Initiative must be ambitious, but it must also be clean, fair and properly governed.

Wider FCA remedies package

The Initiative will form part of a wider package of work following the FCA’s Pure Protection Market Study.

The FCA has made clear that 2 other industry-led work-streams, and an FCA-led one will sit alongside the Initiative. They will include adviser engagement work, medical records and access issues, regulatory clarity and consumer prompts. That is welcome. Consumer engagement cannot succeed in isolation. There is little point encouraging consumers to think more seriously about protection if access, underwriting, adviser signposting or process barriers then prevent them from acting.

PDG, and later the executive group and oversight board of the Initiative, will therefore seek to work constructively with the other workstreams as they are established. We will also work alongside the FCA’s own work on implementing the reforms it identifies in its Final Report.

Our first 90 days: the mobilisation plan

If the Initiative begins with general support but no structure, timetable or funding path, momentum will be lost. The early phase through 2026 must therefore turn the FCA’s mandate into a respected and working delivery structure.

Subject to further discussion with the FCA and key market stakeholders, PDG expects the first 120 days to focus on the following establishment work:

1. Receiving formal responses, senior lead details and nominations from key organisations.
2. Confirming the initial stakeholder map and engagement sequence.
3. Developing the oversight board composition.
4. Developing the executive committee composition.
5. Agreeing governance terms of reference.
6. Establishing competition-law and neutrality protocols.
7. Setting a timetable towards the first approved plan.
8. Producing a funding principles paper and then a funding proposal.
9. Producing an outline delivery brief.
10. Establishing initial success measures.

All using the FCA liaison and escalation protocol if needed.

The Initiative should start 2027 with a clear route to proper governance, balanced market participation, funding principles, success measures and a full delivery plan.

The aim is simple: move quickly from encouragement to organisation, and from organisation to delivery.

What we ask of the market more broadly

Beyond the immediate practical steps above, we ask all organisations engaging with the Initiative to:

• come prepared to help build, not simply to comment;
• bring evidence, expertise and constructive challenge;
• recognise that legitimate commercial, operational, legal and governance concerns should be raised early and addressed openly;
• accept that this is intended to be a sustained programme, not a short-term publicity exercise;
• recognise that funding, governance, success measures and delivery need to be settled early;
• respect the governance structure once established;
• avoid duplicating, diluting or competing with the Initiative through parallel proposals that fragment the market’s response;
• and keep the consumer purpose at the centre of the work.

The protection gap is not new. The market has discussed consumer engagement for many years. What is different now is that the FCA has formally identified weak consumer engagement with protection as a central market issue and has asked PDG to lead and convene the market in developing a response.

That creates an opportunity, but also a responsibility, which we all have to take seriously and resolve with our very best endeavours.

What happens next

The previous sections set out both the PDG’s proposed mobilisation work and request immediate actions from the market. Please crack on.

Our next step is to turn those actions into a managed mobilisation process. That means confirming the order in which responding stakeholders will be approached, setting up the practical management approach for responses and nominations, and working with the FCA so that communications following publication of the Final Report are properly timed.

PDG will also begin preparing the first working papers needed to support the mobilisation phase. These will cover governance, competition law and neutrality, stakeholder engagement, funding principles, success measures and the outline delivery brief.

As responses come in, we will look for areas of agreement, issues that need early resolution, and people with the experience and authority to help build the Initiative properly. We will then set out the process for forming the executive group and oversight board.

If you wish to raise any point immediately, or submit a formal response at this stage, please contact us at: [contact details to be confirmed].

This Initiative will not succeed through words alone. It will succeed only if the market now brings the seriousness, resource, discipline and urgency the task requires.

PDG is ready to convene and lead that work with the market.

The Board of the Protection Distributors Group

Emma Thomson (Chair)

Tom Baigrie (Project lead on FCA engagement and the Initiative)

Ian Sawyer (Member of the Initiative team)

Zanele Sibanda (Member of the Initiative team)

David Mead (Member of the Initiative team)

Roy Mcloughlin

Adam Higgs

Charlotte Rogers

Tom Connor

Nathaniel Lee